Tax Cut Power Grab

The Harrisburg Tax Collector to replace the local property tax collector- same tax, different collectors

Opinion- The Editor dissects Governor Wolf’s property tax cut proposal and what it means to Tioga County.

Paul Gordon Collier- An old adage comes to mind when I think about the current debate over property tax reform.  The old adage goes something like this, “He who owns the gold makes the rules.”  This idea of the one who holds the gold being the one who makes the rules is the primary principle why I stand in opposition to a tax cut that could save my family over $1000 a year.

Who should hold the gold? Harrisburg or Local Communities?

As we covered in the last issue of the Tioga Freedomist, Governor Tom Wolf has released his budget for the fiscal year starting in July of 2015.  One of the major components of his budget proposal was property tax reform.

Governor Wolf’s budget outlines a plan the Governor claims will reduce property taxes by as much as 50 percent.  He plans on doing this by funding education through a severance tax (so-called ‘fracking tax’) and other new taxes on everything from cigarettes to child care.  His plan calls on Harrisburg increasing the percentage it pays for public education from 35 percent to 50 percent.  To put that in perspective, that increases Harrisburg’s part in the public education budget by a staggering 43%.

What most people might hear in this debate is that Governor Wolf will cut your property taxes by 50 percent.  As a homeowner, let me tell you that this news would personally have a huge impact on my family’s financial situation.

But, if you simply stop at the opening sentence, you will miss some very important intended or unintended consequences of such a move, as well as miss out on the possibly disputable fact that, at the end of the day, you will still be sending as much of your money (if not more) to governments (be they local, county or state) as you were before the promised 50 percent property tax cut.

The Wolf tax cut is not a tax cut at all, but a re-assignment of tax collector.  The local and county governments will not be collecting as much revenue as they were, but the state government, Harrisburg, will be collecting more.

As anyone who has ever sat in on a local government meeting knows (be they borough meetings or county meetings), a majority of the actual work that that local government does is grant writing and lobbying for a bigger cut of the budgets of the governments higher up in the hierarchy.  Any dollar that comes from a higher office always has strings attached.

If you want to excel in local government, learn how to be an effective grant writer.

What this proposal actually means, if it were to go through, is that the power of local governments would be even more reduced while Harrisburg’s power increases.  A smaller group of individuals will have greater say on the money that local schools get and the conditions the local schools must meet to accept that money.

Coupled with this proposal to replace the local property tax collector with the Harrisburg sales tax collector is Governor Wolf’s bipartisan commission to develop a fair funding formula that will ‘distribute education dollars to local districts.”

This commission will decide whether Tioga County gets to keep more or less of the money the state collects from it, with a significant portion being money that the localities once had the power to control themselves.  Perhaps, if Tioga County is one of the fortunate localities favored by this commission, it may get MORE money than the state collected.  Maybe Tioga County will get some of Dauphin County’s dollars, or, as is more likely, maybe Dauphin County will get some of the dollars our local school districts once collected and put back into our schools.

When one hears of a tax cut, one that could actually reduce their taxes by $1000 or more a year (as in my case), one cannot help but be tempted by such a proposal. But when the benefit of that savings (even if it were NOT offset by new taxes, ones that will actually regressively affect the bottom 20 percent) means a loss of local sovereignty and more direct accountability by a local community, I must singularly, aggressively, reject such a power grab by Harrisburg.

Patrick Henry once said, “Give me Liberty or Give me death.”  Perhaps I can change that to, “Give me local sovereignty, even if it means higher property taxes.”

What he meant to say was this, “Give me local sovereignty, even if it means higher property taxes.”

America was founded on a principle of individual liberty from which we created the great laboratory where many ideas could be tried, with the successful ones being repeated by other local communities.  This proposal is yet another step towards killing the great engine that made America one of the most significant innovators of the past 200 plus years.  The more we consolidate power in small circles, the more we kill that great engine, Liberty.

Read about the Governor’s Budget here.

Read more…

This article is copyright © Tioga Freedomist

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Paul Gordon Collier

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